February 19, 2013

Structured Settlement Sales Decline in 2012

Sales of structured settlement annuities totaled $4,819,124,617 during 2012 (down from $4,974,710,838 in 2011) as reported today by Melissa Evola in her quarterly summary of United States structured settlement annuity provider premium.

The 2012 U.S. structured settlement annual premium total represents the lowest amount since 1999 based upon historic reporting in "Structured Settlement and Periodic Payment Judgments" (S2P2J) and more recent reports by Evola. According to these same sources:

Annual structured settlement annuity premium reached an historic high in 2008 ($6,226,578,725) after consistently averaging close to $6 billion annually from 2001-2007.

Total historic structured settlement premium written from 1975 through 2012 approximates $134 billion. Note: for historic annual totals, see the structured settlement wiki.

Evola's report documents substantial increases and decreases of annual premium among the 12 annuity providers
who participated in the U.S. structured settlement market during 2012
compared with 2011.

Additional noteworthy statistics from Evola's report: while total
structured settlement cases written during 2012 declined to 25,038 (from
28,811 in 2011), the average 2012 premium per case increased to
$192,472 (compared with $172,667 in 2011).

Interest Rate Impact

Many U.S. structured settlement industry participants attribute declining sales to low interest rates
including future forecasts by the Federal Reserve. Market yields on
U.S. Treasury securities at 30 year constant maturity peaked at 13.45
percent in 1981. Here are several historic average annual rates for 30
year Treasury securities (source: U.S. Department of the Treasury):